Pakistan Economy - News & Updates - Archive

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February food inflation soars to 16.05 percent ​

ISLAMABAD (March 12 2008): The Consumer Price Index (CPI), a key indicator of inflation, rose 11.25 percent in February 2008 with soaring 16.05 percent food inflation over the same period of last year.

The February CPI was also up 0.49 percent over January while July-February 8.90 percent inflation has indicated a perpetual rise in overall trend which might go beyond double digits by the end of the year, putting more pressure on the economy.

The data on CPI, released by the Federal Bureau of Statistics on Tuesday, showed that comparing year-on-year basis in February 2008 the CPI rose at an average 11.25 percent against 7.39 percent in the corresponding period of last year.

The food prices were up by 16.25 percent in February from a year ago. The State Bank of Pakistan had already cautioned that continued government borrowings from the bank would result in excessive monetary growth and would perpetuate inflationary pressures.

The food inflation, having 40 percent weight in CPI basket, rose 16.05 percent in February and is likely to go up in March following oil prices adjustment. Economists see the inflationary pressure suppressing wage earners as the pay increase made in the budget has already been offset by previous surge in prices.

The cost of apparel, textile and footwear increased by 6.66 percent during the period under review; house rent 9.96 percent, fuel lighting 6.17 percent, house furniture and equipment 6.35 percent, transport 2.97 percent, recreation and entertainment 0.74 percent education 3.43 percent, cleaning, laundry and personal appearance 13.04 percent and medicare 7.90 percent.

The main commodities, which showed an increase in their prices during February 2008 over previous month included in food & beverages, tomatoes (45.60 percent), vegetables (29.15 percent), pulse masoor (15.79 percent), condiments (15.27 percent), cooking oil (8.58 percent), vegetable ghee (6.28 percent), fresh fruits (5.66 percent), rice (5.22 percent), mustard oil (4.33 percent), readymade food (2.97 percent), tea (2.77 percent), fish (2.57 percent), dry fruits (2.23 percent), sweetmeat and nimco (2.17 percent), pulse gram (2.01 percent), besan (1.17 percent), potatoes (1.11 percent), gram whole (1.09 percent) and betel leaves & nuts (0.95 percent).

Woollen readymade garments (2.61 percent), kerosene (17.16 percent) and firewood (3.08 percent), plastic products (2.13 percent), marriage hall charges (1.88 percent), utensils (1.45 percent), household equipment (1.18 percent) and furniture readymade (1.10 percent), petrol (9.37 percent), diesel (9.29 percent), tyres & tubes (1.63 percent) and vehicles (1.17 percent), toilet soaps (11.77 percent), jewellery (5.31 percent), shaving articles (1.93 percent), hair cut & beauty parlour charges (1.89 percent) and washing soap & detergent (1.64 percent).

The wholesale price impact of that is yet to be passed on to consumers increased by 16.36 percent over the corresponding month of last year with food prices going up 18.26 percent, raw material 8.90 percent, fuel lighting 23.51 percent, manufacturing 8.75 percent and building materials 10.85 percent.

The main commodities, which showed an increase in the prices in February 2008 over last month included tomatoes (36.63 percent), vegetables (26.10 percent), masoor (16.46 percent), condiments (8.99 percent), cooking oil (6.21 percent), bajra (5.92 percent), vegetable prepared/preserved (4.94 percent), vegetable ghee (4.73 percent), jowar (4.70 percent), spices (4.50 percent), rice (4.46 percent), mustard & rapeseed oil (4.08 percent), cottonseed oil (3.49 percent), maize (3.45 percent), beans (3.26 percent), dry fruits (2.74 percent), fresh fruits (2.18 percent), besan (1.64 percent), tea (1.44 percent), gram split (1.32 percent) and oil cakes (1.03 percent).

Raw materials: Mustard/rapeseeds (5.79 percent), tobacco (2.97 percent), hides (1.50 percent), pig iron (1.27 percent), cottonseed (1.19 percent) and skins (1.16 percent). Fuel, lighting & lubricants: Kerosene oil (9.97 percent), motor spirit (9.32 percent), furnace oil (4.42 percent), diesel oil (4.37 percent), firewood (4.19 percent), coke (1.79 percent) and mobil oil (1.47 percent).

Business Recorder [Pakistan's First Financial Daily]

 

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Italy for promoting bilateral trade and investment ​

MULTAN (March 12 2008): Italian Ambassador Dr Vincenzo Prati has stressed the need for promotion of bilateral trade and investment between Italy and Pakistan in different sectors like manufacturing of heavy machinery, power generation machinery, chemicals, dairy, telecommunication, furnace oil, and pharmaceutical products.

Addressing Multan Chamber of Commerce and Industry (MCCI) executive committee meeting, chaired by Jalaluddin Roomi here on Friday, he said that Italy was buying cotton, cotton yarn, fabrics, readymade garments, leather tanned, leather gloves, footwear, metal manufactures, rice, engineering goods, fruits, cutlery, oilseeds, nuts and kernels, gold jewellery and vegetables worth $58.833 million while in exchange it exports high speed diesel, kerosene oil, transport vehicles, telecommunication appliances/equipment, power generating machinery/equipment, paper and paper board and pharmaceuticals.

He said that trade and financing can be increased by promoting business, tourism, exchange of delegations. Muhammad Yousaf said that MCCI would organise a musical night in the historical old fort in the last week of March or first week of April this year and Ambassadors of different countries would be invited to it.

Upon this the Italian Ambassador and his wife consented to attend it. He said that similar function was organised in the past which was attended by ambassadors of 23 countries.

A Memorandum of Understanding (MoU) was signed between the Multan Chamber of Commerce & Industry (MCCI) and Italian-Pak Chamber of Commerce & Industry (IPCCI). Jalaluddin Roomi signed on behalf of MCCI while Ettore Mazocchi signed for IPCCI in a simple ceremony at Multan Chamber.

The MoU was formalised to market analyses and identification of investment and trade opportunities benefiting, reports on specific sectors for mutual trade development, assistance in developing market entry strategies both in Italy and Pakistan, identification of suppliers and importers both in Italy in Pakistan, identification and selection of industrial and financial partners for joint ventures, sharing of corporate and financial information on potential partners, organisation of individual fact-finding meetings in Italy and Pakistan, dossiers on the existing laws, tax system and on the import duties, interpretation, translation and Italian language courses, customised Italian language courses for companies.

Ettore said that Italian-Pak Chamber of Commerce and Industry is a non-profit organisation recognised by the Italian Government, whose main objective is to promote and enhance trade and economic relations between Pakistan and Italy.

The IPCCI intends to play an active role in organising product exhibitions and international trade fairs, B2B meetings, seminars, conferences and round tables to promote knowledge sharing between the two countries.

The Chamber also co-ordinates and manages business and institutional delegations which stimulate both Italian and Pakistani markets. It is mainly due to these activities that the Chamber has developed strong ties within Pakistan and in Italy mainly with sectoral associations, public and governmental bodies and well known personalities within the industrial and local media sectors. Both partners MCCI and IPCCI recognise that its work extends beyond the office: They recognise the prime importance of personal interaction in all bilateral relationships.

To this end, both intend to organise a wide range of events to both facilitate and promote such interaction in the most favourable locations and ambience. Both Chambers will encourage the extensive programme of conferences, seminars, roundtables, business delegations and participation in international exhibitions in order to foster reciprocal knowledge of the two countries and to assist and promote bilateral business relations.

Roomi in his address of welcome said that Multan is a city of saints, preserves its folds immense heritage, rich culture, and centuries-old traditions of learning, wisdom, trade and commerce .It has been an important trade centre and gateway to central Asian states for centuries. It produces 80 percent of total production of cotton.

Business Recorder [Pakistan's First Financial Daily]

 

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'Pakistan, Sri Lanka should take their per capita income to $2500' ​

KARACHI (March 12 2008): Governor State Bank of Sri Lanka Ajith Nivard Cabraal has said Pakistan and Sri Lanka will have to take their per capita income to 2500 dollars so that the people could be empowered to exploit the potential Asia offers to the twenty-first Century world.

Cabraal was speaking on "Economic Growth of Asia" at a select gathering of diplomats, bankers, ECOs of financial institutions, prominent businessmen and journalists jointly organised by Ijara Financing and Emirates Global Islamic Bank Limited at a local hotel on Tuesday. He said that the attention of Australia, USA and Europe was now toward Asia and its riches.

He said that these regions were fully prepared to take advantage of the existing opportunities, whereas, less developed Asian countries were still to prepare themselves. Cabraal said that the Asian countries would have to make a firm commitment to its people who want their respective governments to implement their plans. "A lot of talking has been done and it is time to implement our plan," he said.

He said that there must be a vision for economic development during the next fifty years. "The vision should be pragmatic and it should be implemented after taking all the stakeholders on board."

He said that per capita income in the region (Sri Lanka and Pakistan) is low. Sri Lanka has shown 1600 dollar and Pakistan 1000 dollar as per capita income during 2007. "Unless there is money available with the people of these countries, economic development would remain meaningless. People will have no money to spend and therefore, the progress will remain purposeless. It is therefore, necessary to raise the per capita income to minimum 2500 dollar in Pakistan and Sri Lanka." He said that exportable surplus is another option which must be taken up on war footings.

Cabraal said that how Asia impacts 21st century should be examined. "Are we also taking Asia seriously is another question that should be answered."

He said that 40 percent population of the world lives in Asia where the landmass is only 20 percent. In this space there is huge resource, manpower and opportunity to work. The only question remains to be addressed are how to take advantage of this situation.

He said that the private sector should come up with proposals and where the private sector feels shy, the government should play its role. He emphasised the need to improve infrastructure and to invest in education, health, road-network and in the development of similar facilities that were necessary for overall growth.

He said that as far as Pakistan and Sri Lanka were concerned they should implement the Free Trade Agreement (FTA). Private sector should play its role and ensure that trade relations between the two countries make headway.

He said unless we moved nothing would happen. "It is time to develop vision 2050 and move, act and take all stakeholders on board."

Earlier, in his remark Syed Tariq Husain of Emirates Global Islamic Bank Limited said that Islamic banking in Pakistan was growing and it had captured 15 percent share of the total banking industry.

He said that his bank would expand by increasing its branch network from the existing 10 to 25 in the next one year. He said that there would be expansion in the domestic market and it would be followed by cross border expansion. He said that EGIB would play its role in the economic activity in Asia.

Farrukh Ansari, MD and CEO of the Ijara Financing (Pvt) Ltd, said that the growth in Asia was phenomenal and the poor or less developed countries would have to prepare themselves to take advantage of existing opportunities. Others who spoke included Sirajuddin Anwer, Deputy Governor State Bank of Pakistan and Sirajuddin Aziz, chief operating officer, Bank Al-Falah.
Business Recorder [Pakistan's First Financial Daily]

 

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Rashid eyes more foreign fiscal help ​

ISLAMABAD (March 12 2008): Presidential Spokesman Major General Rashid Qureshi (Retd) on Tuesday said that Pakistan will receive more fiscal assistance from abroad after the receipt of 300 million dollars from Saudi Arabia.

In a telephonic interview to PTV, he said that it will not be appropriate to talk about the detail of this assistance at this stage but the entire nation would see when the big amount reaches the country particularly from the countries, which supply oil to Pakistan.

He said that President Musharraf during his visit to Saudi Arabia has briefed the rulers of brotherly oil rich country that due to sky rocketing prices of oil in the international market the economy of Pakistan was under pressure. It is under these efforts that the Saudi government has given generous assistance to Pakistan which will help mend the trade deficit conditions, he said.

Business Recorder [Pakistan's First Financial Daily]

 

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'Tusdec planning to set up Electronic Complex' ​

LAHORE (March 12 2008): Lahore Chamber of Commerce and Industries (LCCI) and Technology Upgradation and Skill Development Company (Tusdec) will work together to make Pakistan's industrial sector internationally competitive in terms of technology and human resource.

This was decided at a meeting held between Chief Executive Officer, Tusdec, Suhael Ahmed and President LCCI, Muhammad Ali Mian here on Tuesday. Ahmed said that Tusdec was planning to set up Electronics Complex, a common facility centre to help local production of electronic gadgets and mobile phones whose import was presently costing billions of dollars a year.

He said that the Federal Institute of Materials and Homologation (FIMH), being established in Gujranwala, would also go a long way in increasing share of Pakistani products especially fans in the international markets.

China and a number of other East Asian countries had set up their production units in Vietnam whose exports had touched US $146 billion mark and Pakistan could also emerge as a manufacturing hub of the region on embracing new technologies and diversifying its industrial base, Ahmed added.

Business Recorder [Pakistan's First Financial Daily]

 

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Strategy devised to set up more cottage industries ​

SIALKOT (March 12 2008): Punjab government has formulated a strategy for setting up maximum cottage and small-scale industries including agro-based industries in the province. Official sources told Business Recorder here on Tuesday that the government had set aside huge funds for the development of cottage and small-scale industries aimed at generating large number of employment opportunities for the unemployed skilled and semi-skilled persons in the Punjab.

The government had planned to establish agro-based industries in remote and neglected areas by providing incentives and concession to the interested persons for setting up such industries in their respective areas. The concept of this programme was to generate employment opportunities for the skilled and semi-skilled persons besides to discourage the rapid rural migration towards the cities of the Punjab.

This proposed programme would also serve its dual role in broadening strong industrial base and ensure the development process in far-off and neglected areas of the Punjab. The government had already introduced business and investment-friendly policies for ensuring industrial enlargement and foreign investment in the Punjab.

In addition, the government was constantly stressing the business community to produce non-traditional products along with the routine production of traditional products as well to concentrate on bringing innovation in their products. The diversification of products would be much supportive in increasing the export volume in the Punjab.

The Punjab Small Industries Corporation (PSIC) would extend full guidance, assistance and loan facilities to the interested businessmen and newcomers for setting up and upgrading their industrial units in the province.

Business Recorder [Pakistan's First Financial Daily]

 

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Pakistan and Iran to sign gas sale accord next month ​

ISLAMABAD (March 12 2008): Iran will sign a final agreement to export gas via pipeline to Pakistan in April. Iran, the world's No 2 holder of oil and gas reserves, has completed half of the pipeline, which will have a capacity to carry 110 million cubic metres of gas a day to Pakistan, senior pipelines expert at National Iranian Gas Vahid Zeydifard said.

Iran plans to start exporting gas to Pakistan from 2011, a private TV channel reported. The 7.4 billion-dollar project, known as the "peace pipeline," will carry gas from Iran to Pakistan and India to meet the growing energy demand of the two countries.

"Negotiations are at a final stage," Zeydifard said, adding:."Pakistan needs 50 million cubic metres of gas a day, and we can supply the rest to India if they want it."

India currently uses about 108 million cubic metres of gas a day. Iran was unable to commission gas export projects either via pipeline or in liquefied form because US sanctions were preventing international lenders and investors from releasing funds, Zeydifard said.

Pakistan is facing a shortage of gas as domestic fields decline and may have to depend on Iranian fuel to meet demand, which is expanding by five percent a year. Iran and Pakistan had agreed on the pricing formula for transporting natural gas through the proposed pipeline, the official Islamic Republic News Agency reported on October 23.

The National Iranian Oil Company was developing the Kish field, which would transport gas via a 900-kilometre pipeline from Assaluyeh to Iranshar once it was completed, said Zeydifard, whose company transports gas in Iran. Pakistan could start receiving the gas when Iran completed a 400-kilometre section from Iranshar to the Pakistani border, Zeydifard said.

Iran halted gas exports to Turkey in January to meet soaring domestic demand due to extreme winter weather. "We have started exporting gas to Turkey again," said Zeydifard.

"We had supply problems because of the cold weather and disruption of gas supplies from Turkmenistan," he said. Iran sells gas domestically at 20 cents a million British thermal units. The benchmark gas price at Henry Hub, Louisiana, a gas trading point, is 10 dollars a million Btu. Iran might increase exports of gas this year to Turkey by 30 percent to 10 billion cubic meters, Zeydifard said.

Business Recorder [Pakistan's First Financial Daily]

 

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Expert suggests steps to save electricity ​

LAHORE (March 11 2008): The replacement of one incandescent bulb by a compact fluorescent lamp (CFLs-energy saver) by each of 17 million users of our electric utilities, Wapda and KESC can help save about 1,374 megawatts of electricity during peak hours, said the energy conservation expert, Engr Arshad Chughtai.

Giving a presentation on 'impact of energy management on power planning' at Tusdec head office, he said, at present, the power consumption in the country was growing at a rate of 10 percent per annum, predicting that it would get double by 2015. "Major reason for the high growth is consumers' indifference towards saving electricity," he added.

Quoting an example, he said incandescent bulbs, perfected for mass use by Thomas A Edison in the late 19th century, were being phased out in several developed and developing countries at the moment and replaced with CFLs, which use only 20 percent of the energy consumed by incandescent bulbs.

The expert said the use of the CFLs would not only help consumers save a lot of money but also lead to austerity at the national level as generation of each megawatt of energy, at present, costs $1 million.

He said unlike other developed and developing nations of the world, most of the energy ie 43 percent of total generation, was consumed in Pakistan by domestic consumers while industry's share in power consumption was just 28 percent against 63 percent in China and 43 percent in India.

Engr. Chughtai said Pakistan with an installed power generation capacity of 20,000 megawatts, including that of recently installed two rental power plants, was presently facing a shortfall of 2,500 megawatt. He said the measures, including load management, energy conservation and generation of more energy should go side by side to ensure the energy security of the country.

He said the installation of Time of Day (ToD) and Time of Use (ToU) metres can also encourage the consumers to minimise the consumption of the electricity during peak hours as it would change their consumption behaviour. He also suggested the use of low-pressure sodium vapour lamps for streets and proper adjustment of thermostats for energy conservation. Tusdec Chairman Manzar Shamim and other officials were also present during the presentation.

Business Recorder [Pakistan's First Financial Daily]

 

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Pakistan aims to up stationery exports​

12 March 2008 - Karachi, Pakistan

Pakistan’s Trade Development Authority (TDAP) has launched an initiative to boost the country’s stationery exports.

The TDAP recently formed a committee comprising leading stationery manufacturers to look at ways of achieving a $500 million target for stationery exports.

The seven-member committee, led by the chairman of the country’s writing instrument manufacturers association, has been given 30 days to come up with strategic plan to increase the level of stationery exports to $500 million within the next five years.

Office Products International - Pakistan aims to up stationery exports

 

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Solid growth forecast for cement sector ​

Exports expected to soar by 107 per cent, dispatches likely to reach 29.6 million tonnes in FY08​

Thursday, March 13, 2008

KARACHI: Cement sales are expected to rise in the remaining months of fiscal year 2008 (FY08) with rising exports and stable local dispatches, a research report said. Industry sources said that the cement industry is set to increase its sales due to high production and high export orders.

With the advent of the peak local cement demand season in the country and soaring regional prices, demand for Pakistani cement is set to rise further. “Hence, it is likely that in remaining months of FY08, we might see record cement sales on both local as well as export front. Already, in the first eight months (Jul-Feb) of FY08, sales have demonstrated a healthy increase in demand of 23 per cent with dispatches of 18.7 million tons,” said JS Research.

Considering the sales increase of 23 per cent in the eight months of the current fiscal year, the total dispatches are likely to reach 29.6 million tons in FY08. Total dispatches declined in December 2007, but this decline has been due to lesser working days and winter season.

The peak demand season starts in March with the end of winter and advent of suitable weather for construction work. During this season sales can grow by 22 per cent versus 24.2 million tons cement sales in FY07.

Some of the infrastructure development projects including building of 250,000 houses in five years, new canals, highways, buildings and new dams (like Diamir-Basha Dam), announced in the budget FY08 have already been undertaken which would help rising local cement demand.

The President of Karachi Cement Dealers Action Committee (KCDAC), Walibhai Patel said, “Local demand of cement is rising not because of higher local utilisation but due to high exports, and hence less availability of cement is pushing local demand and prices up.”

Cement exports are expected to soar by a massive 107 per cent due to the primary source of overall cement growth in FY08, the high exports owing to the cement supply shortage in India and Middle East which lead to rocketing cement prices in the region.

Pakistani cement companies, due to their excess capacity, are exporting to Middle East, Africa, Afghanistan and India where they are getting a price premium. In the first 8-months of FY08, exports increased by 140 per cent to 4.3 million tons while at the end of the year FY08 the expected total exports would be around 6.6 million tons.

Some Pakistani cement companies have also received orders from Russia where price of cement has reached US$280/ton (Rs860/bag), however, due to logistic problems it seems difficult to export cement to Russia.

In FY08 to-date, Pakistan cement industry brought in 5.84 million tons of new capacity of cement production taking the total cement capacity to 36.1 million tons. This includes DG Khan’s new Khairpur plant & Maple Leaf’s new production line of 2.1 million tons each and some other additions of 1.8 million tons.

Going forward, Lucky Cement with its 2 new lines of 1.26 million tons capacity each and Fauji Cement with its 2.1 million tons new line are expected to come online. With these additions and other expansions, the total industry installed capacity is expected to reach 49.1 million tons per annum by FY10.

Solid growth forecast for cement sector

 

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Bureaucracy hampers Pakistan and India trade ​

Simplified duty regime, contract honouring mechanism needed to increase trade​

Thursday, March 13, 2008

LAHORE: Pakistan and India could mutually benefit by promoting bilateral trade provided the mindset of their bureaucracy based on six decades of hostility changes to facilitate trade.

The liberalisation of trade in the past two decades has put pressure on many domestic industries to import from other regions. This has also forced inefficient industries in these economies to improve quality and cut cost to challenge competitors in their own countries. Pakistan and India, however, are not prepared to allow their efficient sectors to compete similarly in their markets.

An Indian economist admits “we, in India, will do well by projecting trade as a two-way traffic.” However, he adds it will be better if India also dispels the impression that it is interested in tapping the neighbours’ markets but does not want to open up itself for one reason or the other. Somehow, he says, that is the impression that has got stuck whether it is Bangladesh or Pakistan or even Sri Lanka.

Economists express surprise that both countries have offered their huge markets to competitors from developed economies but have denied the same to each other. The two neighbours show undue resistance in this matter and the tactics used are complex and perplexing.

For instance, the economists say, import duty on fabric in India is 10 per cent or a certain fixed amount per kg whichever is higher. Import duty on fabric in Pakistan is 25 per cent. However, the minimum per kg duty on fabric fixed by India is more than the 25 per cent duty on fabric imposed by Pakistan.

In this way, they say, Pakistani fabric that has great potential in the Indian market cannot be exported because its export is restricted through a tricky duty regime. Pakistan’s fabric export to India increased from $48.68 million in 2005-06 to $73.70 million in 2006-07. This fabric was used by the Indian apparel industry for manufacturing garments for export.

The economists say Pakistan’s raw cotton import from India increased from $58 million in 2005-06 to $206.90 million in 2006-07, adding the figure would have been much higher had the Pakistan government allowed timely import of cotton through Wagah border.

Another aspect that is impeding trade between the two countries is the absence of an effective mechanism to enforce contracts. Indian cotton exporters have backed out of many contracts this year as the global cotton rates soar, leaving Pakistani buyers high and dry.

Similarly, they say, there is no mechanism in Pakistan that ensures that contracts signed by traders with their Indian counterparts are honoured. The experts say absence of the most-favoured nation (MFN) status by Pakistan is not a major impediment in the way of increase in trade between the two countries. Though this lapse cannot be overlooked, the Indians have cleverly devised a trade policy that particularly impacts products in which Pakistan enjoys a competitive advantage. If only such hurdles are removed, trade volume could go up considerably, they stress.

The absence of regional trade has also hampered development of business ties between both countries. India is the world’s second most populous country, but is ranked 28th in world merchandise exports while Pakistan is at 65th place. In imports, India is placed at 17th position compared to Pakistan’s 50th. India commands 1 per cent of global merchandise exports while Pakistan’s share is 0.15pc.

In global commercial services, India’s share in exports is 2.68pc and 2.41pc in imports. Pakistan’s exports account for 0.08pc of the total global commercial services’ exports and 0.31pc of imports.

Bureaucracy hampers Pakistan and India trade

 

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Telecom firms invested $8bn in last four years ​

Thursday, March 13, 2008

ISLAMABAD: Telecom companies have invested over 8 billion dollars during the last four years, particularly in the mobile sector whose investment share accounts for 73 per cent.

The cellular mobile sector has invested over 2.7 billion dollar, which becomes a major share of investment by the sector. Local loop segment of the industry is also taking off and in 2006-07 about 7.8 million dollars were invested by this sector while LDI operators have invested about 603 million dollars during this period that is about 15 per cent of the total investment by the sector.

It is expected that the trend of investment may continue in the next five years because a large potential market still exists in Pakistan and all operators intend to grab their share. China Mobile acquired Paktel which has contracted out a 500-million-dollar project to renowned companies like Ericcson, ZTE and Alcatel to roll out their networks.

Similarly, Mobilink also planned to invest 500 million dollars in 2007-08 for improvement of quality of service and infrastructure expansion. Wateen Telecom, which has already laid down 5,400 kms of optical fibre across the country, has announced that it will invest 600 million dollars in the next two years for improvement of its infrastructure.

The telecom sector has emerged the largest recipient of Foreign Direct Investment (FDI) in Pakistan during the last few years as competition has compelled many companies to expand their infrastructure, which requires more investment from foreign sources.

The telecom sector has attracted record inflows of FDI in the last two years and has emerged the only sector of the economy that attracted such huge investment where its share in total FDI crossed 54 per cent.

Telecom firms invested $8bn in last four years

 

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Cement exports to rise as UAE removes duty ​

KARACHI: Pakistani cement exports will be key beneficiaries as the demand for Pakistani cement in Gulf countries will now further rise subsequently after United Arab Emirates (UAE) government has removed 5 percent custom duty on cement to help the fast moving construction sector in Dubai.

This removal of import duty will decrease the cost of importing cement into UAE, in turn increasing the demand for imported cement. The increasing regional cement price is also benefiting Pakistani cement companies who are able to export cement at a price premium. Initially, cement was being exported to UAE at Freight on board price of $60 to $65 per tonne, which has now jumped to $70 to $75 per tonne. With the duty removal in UAE and consequently demand for Pakistani cement rising, local cement companies can further increase export prices.

Already local cement companies have shifted their produce to exports as in the first 8 months (July-February of financial year 2008 have seen record high-level exports of 4.3 million tonnes. It is estimated that As per our estimates, we expect cement exports to reach 6.6 million tonnes in financial year 2008, exporters informed. Cement demand, throughout the world, has been on a consistent rise as construction activities gain pace. This has led to a significant cement price hike especially in countries like India and UAE. Cement prices in UAE have jumped up by over 40 percent in only 2008, forcing UAE government to remove 5 percent custom duty on the import of cement.

The prices of cement have touched record high levels in many countries across the globe. Only in 2008, cement prices in UAE first increased from $87 to $119 per tonne, and are currently standing at more than $136 per tonne. Price of even clinker has jumped to $70 to $80 per tonne in UAE. Similarly, prices in Russia have reached $280 per tonne while in neigbouring India they average around $118 per tonne.

Daily Times - Leading News Resource of Pakistan

 

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Experts suggest steps to achieve cotton crop target​

KARACHI: Pakistan will not be able to achieve next cotton crop target in 2008-09 unless production of quality seeds, supply of quality inputs and adequate water availability is assured, growers and traders said here on Thursday.

They underlined the need for adopting modern agricultural practices to improve and upgrade the cropping standards in the country.

A senior member of Pakistan Cotton Ginners Association (PCGA) and president PCGA Sanghar cotton belt region Rana Abdul Sattar said quality and volume of the crop, especially the Bacillus Thuringiensis (BT) variety of cotton would not improve because of wide use of uncertified seeds.

Lack of expertise in fighting cotton virus and minimising crop from heavy rainfall, around 65 percent crop in the interior of Sindh and adjoining areas including Sanghar, Tando Muhammad Khan, Hyderabad, Mirpurkhas, Badin and Umerkot would be affected, he added.

Sattar said the crop in Digri, Naukot, Sukkur, Khairpur and Nawabshah remained prone to attack of mealy bug and reddening of leaf, where 90 percent of BT cotton crop was sown.

He said “we were still lacking to fight against mealy bug and Cotton Leaf Curl Virus (CLCV) attack and reddening of leaf. Concern was building that the mealy bug and CLCV would cause endanger to the country’s largest cotton belt in Punjab. These conditions would bring into question whether Pakistani cotton producers could meet the 2008-09 production targets or not, he added.

A director on board of Karachi Cotton Association (KCA) and exporter and importer Ghulam Rabbani said the federal government has yet to set the target of crop but would not be able to set above 13 million bales as the country achieved has only 11.8 million bales in the previous season against the target of 14.14 million cotton bales.

He said experts from multinational companies in the field should help and guide growers to produce quality seeds in the country. Only two seed institutes, one each in Sakrand in Sindh and Khanewal in Punjab are unable to produce and cater to the supply of quality seed to the growers.

Rabbani said around 45 percent of the total cultivation in the country is BT type cotton. Nearly 90 percent of this type is cultivated in Sindh and about 30 percent is cultivated in Punjab.

He said September remained crucial month for the cotton crop as it bore fruit during those days, therefore, it is important for the cotton growers to handle the cotton virus attacks with utmost care and with the help of agricultural scientists.

Due to lack of competency, the farmers would face financial crunch while the country would likely to import around 3.5 million bales in the next crop season to meet the textile sector’s requirements.

Next crop in India will be available in July-August 2008, in China during Oct-Nov and in the US in the months of Nov-Dec 2008. The peak maturity months would be Oct-Nov 2008, he added.

He said while many indicators are warning of an economic problem for the world and the US ahead, cotton and copper and other key industrial markets, which have seen significant buying interest.

Traders are confident for a reduction in the Pakistan’s crop supply and also a jump in Pakistan imports. Pakistan has multidimensional ecological and climatic zones so that we should have to divide our agricultural research strategies according to the requirements of various zones.

He underlined the need for improving diversity of cultivators, eco-friendly and cost-effective pest management practices, efficient supply system, commercialisation of variegated and alternative usage of crop produce.

He said that agriculture in many parts of the world has become dependent on petrochemicals in the context of plant protection. He termed the gene discovery as a key tool for biotechnology.

Daily Times - Leading News Resource of Pakistan

 

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being taken to boost dairy investment​

KARACHI, March 12: The Board of Investment (BoI) is taking steps to boost investment in dairy farming sector.

This was stated by BoI director general Arif Elahi while presiding over a meeting at the BoI in Karachi. The meeting was attended by BoI investment adviser Mehboob Haq, State Bank of Pakistan director Mohammad Ashraf, Zarai Taraqiati Bank senior vice-president Mohammad Mansha, Smeda’s provincial chief, and DG fisheries department.

He said that Pakistan was one of the 10 major milk producing countries of the world but unfortunately it had almost no share in the world dairy market.

He said that a two-day seminar will be held in May to discuss ways to develop the dairy farming sector. It will provide knowledge on various techniques to boost dairy farming, including making investment and installation of latest machinery.

The meeting called for devising a long-term policy to get access to the world dairy market. It also stressed the need to form a joint group so as to boost ties among the provincial and the federal governments and the private sector.—PPI

Steps being taken to boost dairy investment -DAWN - Business; March 13, 2008